Formalise contact arrangements as soon as possible. Many women here have found that with no formal residency and contact agreement if the other parent decides they are going ot keep the kids after a contact session it is difficult to get them returned.
Your dw is going to go on about her rights with regards the children, it may help you to bear in mind the courts don't give a toss about your rights or her rights to a relationship with the children. They care about your childrens rights to a relationship with their parents, subtle but very important difference. This difference is one you should always keep in mind and approach all things from the point of view of which situation would benefit them most.
If there is a mortgage on the house you can get an occupation order which basically protects your childrens rights to live in their family home until the youngest is 18.
You may still love your wife and wish for a solution which has a happy ending, however for now you have to put your children first and cover all legal bases for them to ensure they have a stable financial future and a home to live in. Get the legal ball rolling now.
Keep diaries of contact and keep all correspondances/mails/texts as a precaution.
Never defend her but never bad mouth her either she will be a shining light or a forgotten memory in your childrens lives of her own doing, you will never be able to force the issue with her.
Make sure both you and your children have access to support and counselling if you need it. Look up childminders, surestart centres and all the groups you can which may be able to help you.
You are not alone in this.